Solutions should be taken to create stable material areas to promote sustainable development of the wood industry, insiders have said.

Vietnam’s forest coverage rate is set to reach 42-43%, while the forest production value is expected to increase by 5-5%, according to the forestry development strategy for the 2021-2030 period.

Under the strategy, the country aims to earn 23 – 25 billion USD from exporting forestry products, and grow 1 million ha of big timber forests nationwide by 2030 to form sustainable raw material zones for the wood processing industry serving export and domestic consumption.

According to businesses, although the timber supply currently meets over 70% of the demand for processing wood for export, the stability and sustainability remain low due to the insufficient quality of planted trees.

The Ministry of Agriculture and Rural Development (MARD)’s Forestry Department said that localities are facing difficulties in afforestation efforts, particularly in planting high-quality big timber forests, due to the small-scale planning land plots, fragmentation in many areas, and dispersed rather than contiguous regions.

Due to the scarcity of supply from planted forests, wood processing enterprises are facing many difficulties in purchasing raw materials.

To address this situation, enterprises are advised to promptly develop cooperative development plans along the forestry product value chain, and promote collaboration models between enterprises and growers granted sustainable forest management certificates in localities.

These are important prerequisites for promoting stable and sustainable development of the wood industry, thus meeting the demand of the markets.

Insiders said, to quickly address the shortage of wood materials, there is no better solution than developing high-quality production forests and sustainably certified forests by international and domestic authorised organisations.

Statistics from the Forestry Department showed that the forest area nationwide has increased quite rapidly, curently standing at about 14.74 million ha, with planted forests accounting for 4.57 million ha or 31%, and natural forests marking up 10.17 million ha or 69%.

Apart from providing jobs for millions of farming households, planted forests have become the main source of supply for the wood processing industry and exports.

Many localities have focused on developing big timber forests, improving productivity and quality of forests associated with promoting sustainable forest management and increasing the area of certified forests, thus providing legal and quality materials for processing, and increasing incomes for forest growers.

To realise the forestry development strategy in the 2021-2030 period, the MARD devised several measures in its plan, including reviewing the land reserves and big timber forests eligible for development, connecting forest growers with businesses, and promoting sustainable forest management and forest certification.

It will also step up the development of high-yield and high-quality plant varieties that meet the market’s demand and are resistant to diseases and adverse environmental conditions to use for afforestation.

Favourable mechanisms and policies such as exempting or reducing land rent and land use tax, supporting investment, and providing soft loans to attract private resources to developing big timber forests.

FDI sector remains export pillar of Vietnam’s economy

The foreign direct investment (FDI) sector maintained its role as an export pillar of Vietnam’s economy with revenue of 43.2 billion USD in the first two months of this year, up 14.7%, and accounting for 72.8% of the country’s total export value.

Exports of items as phones, computers, machinery, equipment and garments-textiles experienced strong growth, ranging from 4.1% to 33.9%, Dau tu (Investment) Newspaper reported.

Meanwhile, electronic products, garments-textiles and footwear, among others, gave a boost to the import of materials in service of production, which saw a year-on-year rise of 18%.

In the two months, Vietnam posted a trade surplus of 4.72 billion USD, with the FDI sector, including crude oil, recording a trade surplus of 8.25 billion USD.

Notably, the US imported 17.4 billion USD worth of goods from the Southeast Asian nation, a year-on-year increase of 33.7%. Vietnam ran a trade surplus of 15.2 billion USD with the US, up 36.3% from the same period last year.

Almost most-purchased items were supplied by FDI firms, including computers, phones, electronics and components, machinery, equipment and spare parts, garments-textiles, and footwear.

Once fully tapped, the US market would offer over 100 billion USD in export revenue to Vietnam in 2025, said Trade Counsellor and head of the Vietnam Trade Office in the US Do Ngoc Hung.

Hung, however, noted that more trade barriers have been set up by the US to protect domestic production, and advised Vietnamese management agencies, businesses and localities to stay updated on changes in politics and policies in the country to take timely response.

In January and February, Vietnam also shipped 7.7 billion USD worth of goods to the European Union (EU), a surge of 14.2% year-on-year, and the rise is expected to continue in the time ahead thanks to the EU-Vietnam Free Trade Agreement (EVFTA).

After the deal came into force in August 2020, the two-way trade has experienced double-digit growth, as compared with a 5%-7% rise in Vietnam’s exports to the EU, and 3%-5% in imports in the previous period.

Vietjet opens Hanoi – Hiroshima direct route

Vietjet has opened a direct route from Hanoi to Hiroshima, connecting the capital of Vietnam with the famous city of Japan, bringing more convenient tourism and trade opportunities between the two cities and two countries as a whole.

Operating from May 12, 2024 with two return flights per week on Thursdays and Sundays, people and tourists can easily travel between Hanoi and Hiroshima with a flight time of around 4 hours per leg. The flights depart from Hanoi at 6:00 (local time) and arrive in Hiroshima at 12:30 (local time). The return flights depart from Hiroshima Airport at 13:30 (local time) and arrive at Noi Bai Airport (Hanoi) at 16:20 (local time).

Footwear exports see promising signals

With orders secured for the second quarter, activities are in full swing in many leather and footwear production plants, bringing about the hope for a year of buoyant exports.

According to data from the General Statistics Office, as of February 15, leather and footwear product exports raked in more than 2.46 billion USD, up 16% year-on-year.

Phan Thi Thanh Xuan, Vice Chairwoman and General Secretary of the Vietnam Leather, Footwear and Handbag Association (LEFASO), said the sector still focus on its five key export markets, namely the US, which accounts for about 35% of its total export revenue, the EU, Japan, the Republic of Korea, and China.

Notably, the growing turnover from the Chinese market has come as a boon for the sale of these products abroad this year, she assessed.

Despite the current surge in the number of orders, experts believed that difficulties and challenges remain ahead. Green and sustainable standards that require eco-product policies, extended producer responsibility, and supply chain traceability, among many others, are likely to be applied on Vietnamese goods by their major importers. The compulsory adherence to those requirements means a significant pressure for enterprises.

Nguyen Quang Vu, Chairman of the Leather, Footwear and Handbag Association of the southern province of Binh Duong, underscored business connectivity as a solution, because an individual firm might lack investment to build such a production ecosystem as required. It is the only path toward development, he said.

In a bid to support the sector, the Ministry of Industry and Trade has planned large-scale trade promotion events for its key products, helping them to expand their export markets.

Aquatic exports surge by 23% in two months

Vietnamese seafood exports during the first two months of the year soared by 23% to US$1.3 billion against the same period last year, with many businesses receiving new export orders, according to industry insiders.

Do Thi Thu Thuy, sales director of Nam Viet Group, pointed out that Tra fish (pangasius) exports rebounded in the reviewed period as major markets started placing large export orders.

Tran Anh Khoa, general director of Anh Khoa Co., Ltd. in the southern province of Ca Mau that specialises in exporting shrimp, assessed that foreign importers such as China and the Middle East currently have high demand for the aquatic product.

Many Chinese buyers are selling directly to retail customers through e-commerce channels, meaning that they need large quantities of goods, Khoa said.

He added that these buyers consider Vietnamese shrimp to be of higher quality than those from Ecuador and India and are therefore willing to accept higher prices.

Sharing this perspective, Truong Dinh Hoe, general secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP), emphasized that seafood exports bounced back during the two-month period.

In February alone, aquatic exports were estimated to be at US$564 million, down 8% against the same period from last year, thereby raising the two-month turnover to over US$1.3 billion, up 23% on-year.

Of the figure, pangasius exports nearly doubled to US$365 million against the same period from last year, with positive signs from small markets such as the UK, Canada, Mexico, and Brazil.

In the reviewed period, shrimp and tuna exports both increased by 37% on-year, while pangasius exports and other types of fish rose by 15% and 8%, respectively.

With regard to export markets, there are bright export prospects ahead in China, the United States, Japan, Canada, and Australia, particularly as China’s demand for seafood products is recovering well.

In addition, Vietnamese shrimp also has enjoyed advantages over its competitors as Ecuador is being warned due to shrimp containing sulfites along with rising freight rates.

Le Hang, VASEP Communications Director, however, pointed out that the high inventories and oversupply source will affect the consumption demand for major aquatic items such as shrimp and pangasius.

In addition, Vietnam’s seafood exports to the EU market are still facing numerous difficulties due to “yellow card” against illegal, unreported and unregulated (IUU) fishing imposed by the European Commission.

In March and April, seafood businesses are set to engage in the International Seafood Fair programs in Boston, the US and Spain, Hang said, noting that there will be positive outlook for export businesses. 

Canada to issue new regulations on package of imported goods

New Canadian regulations for imported goods will exert an impact on Vietnamese export businesses moving forward, according to industry insiders.   

Tran Thu Quynh, Trade Counselor at the Vietnamese Embassy in Canada, predicts that there will be more challenges ahead for Vietnamese businesses.

She revealed that the province of Quebec has been recently cracking down on firms with new French-language rules implemented for commercial signs and packaging on imported goods.

The new regulation draft is expected to affect many enterprises, including those in English-speaking provinces and Vietnam that sell goods into Quebec. The draft is set to take effect from June 1, 2025, with some exceptions until June, 2027.

According to statistics compiled by the General Department of Vietnam Customs, Vietnamese exports to Canada last year dropped by 11.3% to over US$5.6 billion against the same period last year.

Meanwhile, figures released by Canadian agencies on February 8 reveal that Vietnam exported goods worth US$9.82 billion to the country, representing a slight decrease of 0.4% compared to 2022.

Since the beginning of the year, two major product groups that account for the largest proportion of Vietnamese export turnover to Canada include electronics, phones mobile, up 1.6%; and boiler reactor up 63.9%.

Other products also recorded positive growth including handbags, up 3.9%; auto parts, up 59%; ships, up 218%; and copper and copper products, up 16.9%. Currently, Canada has been Vietnam’s seventh largest export market. 

Removing roadblocks in FDI attraction into Vietnam to move forward: HSBC

Vietnam needs removing roadblocks in order to lure greater foreign direct investment (FDI) moving forward, according to Tim Evans, Chief Executive Officer (CEO) of HSBC Vietnam.

The CEO emphasised that the Government’s strategy to attract additional FDI into the country should start with understanding the competitive landscape between Vietnam and the rest of ASEAN, whilst also looking at other market such as India and Mexico.

He revealed that Singapore and Malaysia are currently leading the semiconductor ecosystem, with Singapore being the wafer fabrication and front end equipment hub and Malaysia being the packaging and back end testing hub. Thailand has become the established auto supply chain and power supplier for EVs, whilst Indonesia is targeting the EV ecosystems with its abundance of nickel and a large domestic auto market.

Meanwhile, the Vietnamese side is slowly venturing into both EV and semiconductors as it aims to focus on more high value added goods but continues to perform well in terms of enticing large electronics manufacturers into the market off the back of competitive pricing, stable, and consistent Government support. This is along with other factors such as having the large number of free trade agreements (FTAs) in place in the region and the work ethic of the Vietnamese.

The HSBC representative underscored the importance of identifying the biggest ‘pain points’ as perceived by foreign investors and set a comprehensive and implementable action plan in place aimed at addressing these.

First is the overall quality and accessibility to labour and the ongoing need to improve productivity as Vietnam moves up the quality curve. The nation still ranks behind other major ASEAN markets in terms of labour productivity with output per hour worked being relatively low at 9.7 compared to a range of 10~26 for other ASEAN member nations. 

Second is that the Vietnamese logistics performance index also lags behind that of China, Malaysia, and Thailand, with gaps shown in logistics capacity, delivery time, and traceability.

Logistics infrastructure currently falls short of meeting the expected international standards and road transport command, whilst a 74% share of overall transport shows the demand is actually skewed towards sea transport and port space, thereby supporting the export story from Vietnam.

Finally, regulatory navigation continue to be a critical consideration for investors looking to invest into the nation.

According to the latest HSBC Global Connections survey, regulatory developments are among the top two challenges for foreign firms operating in the country, in which 30% of surveyed companies pointed to the challenge of adapting to fast-changing regulations and policies within the market.

A more consistent and easy to comprehend regulatory framework would be a positive step in attracting new parties to invest into the market, Evans noted.

Trade ministry issues warnings for steel wire at risk of investigation

The Trade Remedies Authority of Việt Nam (TRAV) under the Ministry of Industry and Trade has provided early warnings for steel wire originating from Việt Nam which was facing a high risk of being investigated for trade defence measure.

Statistics from the TRAV showed that Canada has launched investigations into eight trade defence cases targeting steel products exported from Việt Nam. These cases include five anti-dumping investigations, two anti-subsidy investigations, and one case based on self-defence.

Canada is specifically targeting Việt Nam's primary export steel products and types, including concrete reinforced steel, anti-corrosion steel plates, steel coils and oil pipeline steel pipes.

According to TRAV, Canada's policy of closely monitoring and strengthening the management of imported steel to safeguard the domestic market suggests that further research and investigations are anticipated. It is likely that Canada would extend these measures to include other steel products from Việt Nam, including steel wire products.

This item is widely used in various sectors, including prestressed concrete wire (PC Wire), umbrella frames, tire bead wire (TBW), piano wire, wire cores for conductors, cables used in elevators and cranes, welding electrode cores and nails.

Statistics from Trademap showed that Việt Nam's export turnover of steel wire products to Canada has increased rapidly in recent years. In 2020, Việt Nam exported approximately US$10 million worth of steel wire to Canada. The export turnover of this product doubled to $21 million in 2021 and continued to see strong growth, reaching around $40 million in 2022. This caused Canada to conduct an investigation and apply trade remedies against Vietnamese steel wire.

In addition to issuing the early warning, TRAV has advised the relevant associations and enterprises to carefully review their steel wire exports to the Canadian market (referring to the HS codes of 7223, 7213, 7227, 7306) and be prepared to respond in the event of a trade remedy investigation by Canada.

In case of an investigation, it is crucial for the concerned associations and businesses to fully cooperate with the investigating agency as per their requirements. They should also maintain regular communication and co-ordination with TRAV to receive necessary support. 

Hanoi recognises 104 four-star OCOP products in 2023

The Hanoi People's Committee on March 4 issued a decision recognising 104 four-star “One commune, One product” (OCOP) products of 32 entities participating in the capital city’s OCOP programme in 2023.

Among the districts with the recognised products, Thanh Tri, Chuong My and Phu Xuyen had the most four-star OCOP products with 12 certified products each.

The municipal People's Committee assigned the Hanoi Department of Agriculture and Rural Development to guide the People's Committees of districts, townships and entities with the OCOP products to use and print OCOP trademarks and star ratings on certified product packaging according to regulations.

In addition, the municipal People's Committee coordinated with relevant departments and sectors to hold periodical inspections to handle violations.

The classification results are valid for three years from the date of signing the decision.

The OCOP programme has contributed to changing the practices of rural communities, paving the way for new manufacturing models and trade of traditional goods that are of local advantages.

Approved in Prime Minister’s Decision No. 490/QD-TTg on May 7, 2018, it encompasses three primary goals: developing forms of organised production and business, changing the economic structure to improve incomes, and advancing agriculture and production in rural areas.

After more than five years of implementation, Vietnam now has more than 10,300 OCOP products in all 63 provinces and cities.

Among these products, more than 67% have achieved three-star status, while over 30% have been awarded four stars, and nearly 1% have the potential to achieve a five-star recognition.

In addition, over 5,360 businesses are joining the OCOP programme, of which over 38% are cooperatives, more than 24% are enterprises, and nearly 35% being production or business households.

Vietnamese enterprises attend Foodex Japan 2024

As many as 22 Vietnamese enterprises are showcasing their products at Foodex Japan 2024, one of the largest international food and beverage exhibitions in Asia, which kicked off in Tokyo, Japan on March 5.

They include leading companies operating in the agricultural and food industries such as Masan Group Corp, An Khang Food JSC, Long Son JSC and Dong Giao Food Export JSC (Doveco).

According to Vietnamese Trade Councillor to Japan Ta Duc Minh, this year the increased number of Vietnamese booths at the exhibition means that the number of products introduced this time is more diverse. On this occasion, the Vietnamese trade office in Japan will organise business connection sessions so that importing enterprises can sign contracts with Vietnamese counterparts.

He noted that Vietnamese enterprises have paid attention to details like packaging to suit the taste of Japanese consumers, besides quality and food safety of the products.

Satake Yoichiro, a visitor to the exhibition, said he enjoys Vietnamese rice and feels that it was very delicious. He also loves Vietnamese dried fruits, especially dried mangoes, adding that he often receives gifts from Vietnamese friends like cashews nuts and they are all his favourite foods.

First held in 1976, Foodex Japan aims to promote food diversification in Japan and Asia, develop sustainable solutions to food waste, and support technological advancements for increased productivity.

This year’s event, which features 3,913 booths of 2,879 businesses from 68 countries and territories around the world, will run until March 8. It is expected to attract 80,000 visitors, including 15,000 foreign ones.

Can Tho leader, Malaysian Ambassador explore agricultural cooperation

Vice Chairman of the People’s Committee of the Mekong Delta city of Can Tho Nguyen Ngoc He and Malaysian Ambassador to Vietnam Dato’ Tan Yang Thai explored possibilities for further bilateral cooperation, with a particular focus on agricultural sector, during a local working session on March 5.

Highlighting Can Tho as the first-tier municipality that is located in the heart of the Mekong Delta renowned for its strengths in rice, fruits and aquaculture, He wished that Malaysian firms would consider investing in the city, especially in sectors needing investment, such as food processing, hi-tech agriculture, logistics and smart technology.

Furthermore, he also encouraged them to invest in the Mekong Delta farm produce processing and selling centre, a project endorsed by the Prime Minister to be situated in Can Tho.

The city is committed to creating the most favourable conditions for Malaysian firms to invest there, with support policies and incentives, he said.

The Malaysian Ambassador cited 2023 statistics that show Malaysia as the sixth largest importer of Vietnamese rice. He also emphasised Vietnam's crucial role in ensuring food security for Malaysia, particularly in light of the nation's limited capacity for food production.

He pledged to raise awareness among Malaysian people and businesses about the Vietnamese city's potentials, beauty and investment opportunities, urging them to explore investment prospects in the city.

According to the municipal Department of External Affairs, the city now hosts one Malaysia-invested project valued at around 285,000 USD, which manufactures various roofing products and workshop frames.

Last year, Can Tho exported goods worth 35.9 million USD to Malaysia, mostly rice, aquatic products, processed farm produce, apparel, pharmaceuticals, and veterinary drugs. Conversely, imports from Malaysia were estimated at 0.28 million USD, primarily materials for pharmaceutical and garment-textile industries.

In the afternoon the same day, the Malaysian diplomat visited the Trung An Hi-Tech Agriculture JSC in Thot Not district. This company specialises in processing and trading various types of clean and organic rice.

Retail sales of goods, services increase by 8.5% in February: GSO

The total retail sales of goods and consumer service revenue in February increased by 8.5% over the same period last year to 509.7 trillion VND (20.63 billion USD), according to the General Statistics Office (GSO).

The figure contributed to a year-on-year rise of 8.1% in total retail sales of goods and revenue from consumer services in the first two months of this year to 1.03 quadrillion VND.

Of the total, retail sales of goods were estimated at 798.3 trillion VND, accounting for 77.4% of the total and up 6.8% over the same period last year (up 4.5% if excluding the price factor). 

Of which, retail revenue of food and foodstuffs rose by 10.8%, while that of household appliances and tools was up 18.1%, garment 9.8%, vehicles (except cars) 1.8%, and cultural and educational products 16.5%. 

Particularly, revenue from accommodation and catering services rose by 14%, while that from travel services surged by 35.8%.

Thanks to the favourable visa policies, tourism stimulus programmes as well as the efforts of the Government and people, the number of foreign visitors to Vietnam in February reached more than 1.5 million, up 1.3% over the previous month and 64.1% over the same period last year. The number for the first two months of this year hit more than 3 million, an increase of 68.7% over the same period last year.

As a result, revenue from tourism services in the first two months of this year reached 9 trillion VND.

Meanwhile, revenue from other services was estimated at 105.9 trillion VND, accounting for 10.2% of the total and increasing 9.7% over the same period last year.

Economists held that the shopping season during the Lunar New Year (Tet) festival was a leverage for retailers to boost domestic demand and increase revenue right from the beginning of the year. The business outcomes in Tet also showed the consumption trend of the year, helping enterprises decide their market development strategies and business plans for the year, they added.

Bac Ninh province on right tract in FDI attraction

Drawing 78 new foreign-invested projects worth nearly 200 million USD in the first two months of this year, the northern province of Bac Ninh is on the right track to realise the goal of 1.1 billion USD in foreign direct investment (FDI) in 2024, according to the provincial Statistics Office.

In the January-February period, China led in the number of newly-registered projects in Bac Ninh with 46 projects, followed by Hong Kong (China) with 14.

Meanwhile, 170.9 million USD was added into 34 underway projects, while 23.9 million USD was poured into share purchase and capital contribution deals.

In the period, Bac Ninh also granted investment licences to nine domestically-funded projects worth over 2 trillion VND (80.97 million USD). The province is now home to 1,560 valid projects with combined investment of 261.06 trillion VND, the office reported.

Experts attributed the results to the province’s efforts to build and complete mechanisms and policies to attract strategic investors on the foundation of the provincial planning scheme in the 2021-2030 period.

At the same time, the province has shown strong performance in ground clearance and infrastructure building in industrial parks and industrial clusters, as well as in improving the investment environment.

Bac Ninh has actively sought potential investors, while working hard to remove difficulties in production and business activities.

Since the beginning of the year, leaders of Bac Ninh and members of the expert groups for removing obstacles in investment have held many meetings with local businesses and investors to explore their difficulties and put forth solutions.

Female business leaders in Vietnam rising

Vietnam has been in the world’s top 10 countries having the highest share of senior female managers in recent years, which demonstrates female entrepreneur’s management capacity and gender equality in business establishments.

International Business Reports from Grant Thornton, a leading independent assurance, tax and advisory firm, showed that Vietnamese women hold 37% of senior management positions in 2019, and the figures in 2021, 2022, and 2023 were 39%, 33%, and 34%, respectively, much higher than the world and the Asia-Pacific’s levels.

The report in 2023 revealed that the top two roles of Vietnamese women in businesses were Human Resources Director (61%) and Chief Finance Officer (44%).

Women own 20-24% of the 900,000 enterprises in the country.

Up to 68.6% of female entrepreneurs hold graduate degrees and master's degrees on business administration as compared to the 71.9% of businessmen.

However, due to socio-cultural barriers, most of the women-led businesses are operating in a small scale and in labour-intensive sectors. Additionally, low adoption rate in advanced technologies have led to low profit in the enterprises, and make it hard for the firms to stand up to economic turbulences.

In Vietnam, it is much harder for women to start their business than men since they have less access to financial support and concessional loans. Statistics showed that only 37% of the women-led small- and medium-sized businesses are able to get loans while the figure is 47% for men-owned firms.

Along with gender norms and limited access to resources, many women lack skills and knowledge of corporate governance, human resources, finance and marketing.

Over the past time, a multitude of policies, legal regulations and programmes to support women’s startup have been launched. However, in order to help women score further successes, specific measures should be outlined by the Government, competent organisations and the whole society.

Nguyen Thi Thanh Tam and Trinh Thi Nhuan, lecturers from Thuong Mai University, suggested the Vietnam Women’s Union roll out financial and non-financial support to women’s startup and sustainable development.

Administrative reforms should be promoted to reduce business procedures and training courses organised to improve women’s capacity, they added.

Weekly container service connects RoK port with Vietnam

The Incheon Port Authority (IPA) has announced that Maersk, a global shipping company, launched its new PH5 service at the Incheon Port on March 4, a weekly container service that connects the Republic of Korea’s Incheon with Vietnam and Thailand via China.

The service will deploy five vessels, each having a capacity of 2,544 TEU-2,826 TEU, with the first, the MAERSK NINGBO, having already arrived at the Hanjin Incheon Container Terminal to load cargo.

The main ports of call on the route are Xiamen, Hong Kong (China), Laem Chabang (Thailand), and Cat Lai-Ho Chi Minh City (Vietnam).

The IPA expects the new service will increase the volume of cargo, including raw materials, auto parts, daily necessities, furniture, and small home appliances, by more than 60,000 TEU per year.

An IPA official said the new service has increased the number of port calls to Vietnam and Thailand from Incheon Port to 29, helping small- and medium-sized enterprises expand their export markets, and provide shippers and freight forwarders in urban areas with more options.

The Incheon Port is committed to working with shipping and logistics companies to ensure the stability and development of the route.

Source: VNA/SGT/VNS/VOV/Dtinews/SGGP/VGP/Hanoitimes